In the months just before the United States' entry into World War I
against the German Empire and its allies the government started paying close
attention to a number of German merchant ships lying in American harbors. In
March 1917 Attorney General T.W. Gregory reported to Secretary of Labor William
B. Wilson that a number of these ships had been deliberately damaged by their
crews and could not move under their own power. Officials were concerned that
the ships, which were in busy harbor and urban areas, had explosives and
flammable materials on board and that in case of war the crews might blow up
the vessels. Gregory felt it was urgent that plans be made to tow the ships to
safe anchorages. He pointed out to Wilson that, as these were not warships, the
Navy would have no authority over their crews but suggested that the Labor
Department did have authority here because of its responsibility for
immigration matters.

Wilson agreed. When it became clear that war was imminent, he directed
the Bureau of Immigration, in coordination with the Customs Bureau (Treasury
Department) and other agencies, to prepare to take custody of the officers and
crew members of the German ships. Orders were issued to federal officials in
the ports where German ships lay to have all in readiness to proceed as soon as
the word was given. During the night of April 5 officials of the Bureau stayed
with Wilson and his staff while Congress considered the declaration of war. At
3:14 a.m. on April 6 they were informed that a state of war existed; one minute
later Wilson cabled officials at all affected ports the prearranged message:
"proceed instantly. Wilson." Treasury Secretary William McAdoo then cabled the
waiting Customs Bureau officials to take charge of German vessels whose crews
were taken into custody. The next step was to telephone all the forces involved
and confirm that they were to go ahead with the operation.

Federal officials, accompanied by military personnel, took possession
of the vessels almost without incident. There were 91 German-owned vessels in
American waters with a combined displacement of about 600,000 tons. New York
harbor held 27 of the vessels, including the 54,000 ton passenger liner
"Vaterland." The rest of the ships were scattered in ports on all three coasts
and in several overseas possessions. The only serious incident occurred at Guam,
where the German gunboat "Cormorant" was blown up by its
officers before federal officials could take charge of it. Five crewmen
perished. The German ships seized were worth an estimated $100 million (1917
dollars). It was found that machinery on all but the "Vaterland" been disabled
and several weeks were needed to complete repairs.

The government's immediate goal was to protect the ships from further
damage. Customs guards were placed on board and a few days later machinists
began making rapid repairs. The United States was desperately in need of ships
to transport troops and supplies to the war fronts in Europe and was anxious to
press the German ships into service against their former flag country. While
the ships were being restored, the Bureau of Immigration arranged for the
internment of those taken from the vessels. These officers and men were not
considered prisoners of war, but illegal aliens from an enemy country, and
proper provision had to be made for their care and safety. At first the men
(there were no women) were detained in temporary quarters in the ports where
they were seized. The goal, however, was to house them in one facility. The
Bureau soon located a hotel building in Hot Springs, North Carolina, which,
together with buildings to be constructed on adjacent land, could accommodate
the approximately 2,000 detainees. They would be joined by other German seamen
and aliens brought into custody under the President's Alien Enemy Proclamation.
In June 1917 Congress appropriated $1,000,000 to cover internment expenses. The
number of internees at Hot Springs peaked at 2,300. Subsequently that number
shrank slightly as some of them were paroled and allowed to hold jobs.

In 1918 the Department of Labor relinquished control over the internees
to the Justice Department. This was done effective July 1, 1918, and they were
placed within the War Department's regular camps for all alien enemies. At that
time the Department of Labor's role in the internment of the German seamen
ended.